Has Africa finally turned a corner?

JOHANNESBURG, SOUTH AFRICA
— With a decade of sustained economic growth, increasing demand for African minerals and oil, and a falling number of conflicts, the trend lines for some countries in sub-Saharan Africa are finally starting to look pretty good.

A new World Bank report, issued last week, has gone as far as to say that 2005 may be the year when Africa "turned the corner" from poverty and debt to prosperity and wealth. In a continent that was once almost entirely dependent on foreign aid, there are now 16 countries that have achieved annual growth rates in excess of 4.5 percent for more than a decade.

"Africa today is a continent on the move, making tangible progress on delivering better health, education, growth, trade, and poverty-reduction outcomes," said Gobind Nankani, the World Bank vice president for the Africa region.

The African Development Indicators for 2006 report, of course, doesn't pretend that all of Africa's problems have been solved – from the spread of HIV-AIDS to continued conflicts in Sudan and Somalia to the persistent lack of basic services, such as water, sanitation, and education. But for a continent that has gotten used to hearing glass-half-empty analysis of what has gone wrong, the report has decidedly emphasized what has gone right.

"While economic outcomes are increasingly diverse, Africa has made near uniform progress in social outcomes, notably education and health," explained John Page, the World Bank's Chief Economist for the Africa Region.

It is the very diversity of Africa – with fast-growing oil states like Equatorial Guinea and rapidly-declining states like Zimbabwe – that makes any sweeping statement imprecise at best. Yet here are a few encouraging trend lines that are starting to have repercussions of the positive sort.

•The number of conflicts in Africa has dropped to just five in 2005, from a peak of 16 in 2002.

•During the past two decades, fertility rates have dropped in every African country. The greatest drop in fertility is found in Namibia to 3.8 in 2004 from 5.9 in 1990, followed by Rwanda, to 5.5 (2004) from 7.4 (1990).

•Several African countries, including Senegal, Mozambique, Burkina Faso, Cameroon, Uganda, and Ghana are on course to cut the number of people living in poverty by half by 2010. Cutting poverty is one of the Millennium Development Goals agreed to by 189 nations in New York in 2000.

•Enrollment in primary schools has increased continentwide to 93 percent in 2004 from 72 percent in 1990, and literacy rates have consequently risen to 65 percent in 2002 from 50 percent in 1997.

Low incomes, bad roads and ports

Yet amid these positive trends, there are darker clouds as well.

•Almost half of Africa's population still lives below the poverty line, which the World Bank defines as an income of less than $1 a day.

•African economies must grow at about an annual rate of 7 percent – on a par with India and China – in order to meet their target of cutting poverty in half by 2015. Governments must also either invest or encourage investment of at least 5 percent of their gross domestic product in infrastructure in order for their economies to continue growing.

•Inadequate roads, inefficient ports, and power outages have helped make Africa home to six of the 10 countries judged to be the most difficult environments in which to start a business, according to a recent World Bank study. The lack of foreign investment – Africa received just 1.6 percent of all foreign direct investment ($10.1 billion) in 2005 – means fewer jobs to relieve poverty.

Prosperity brings new challenges

Sarah Crowe, spokeswoman for the United Nations Children's Fund (UNICEF), says that even economic prosperity can bring its own set of new challenges.

"We're now moving to a world of peri-urban slums and megacities bursting at the seams – such as Kinshasa and Lagos and Nairobi – with people moving to cities to find work," says Ms. Crowe. Such big cities have been unable to keep pace with the population growth, and growing demand for clean drinking water and sanitation facilities. Big cities are also key points for the spread of HIV-AIDS, a disease with devastating economic potential, since it targets primarily those who are in their prime working years.

"Unquestionably, there is a momentum there, but the big challenge for NGOs (non-governmental organizations) will be these gray areas," adds Crowe.

Some in the aid community say that the World Bank's report may have been overzealous in painting a picture of African progress. "Turned a corner?" chortled one American financier with decades of experience in African aid projects. "This is a maze we're in here. There's going to be lots of corners."

Greg Mills, director of the Brenthurst Foundation, a think tank on strengthening African economic performance, argues that the most important trend seen in the World Bank report is showing that Africa can no longer be seen as a single entity.

"What the World Bank report is showing is the growing differentiation in the African continent, and the different problems between countries and regions," he says. "This is contrary to the notion of African Unity."

There are commodity-producing countries like Nigeria, Democratic Republic of Congo (DRC), Sudan, and South Africa, and agricultural powerhouses like Kenya and Tanzania. There are landlocked nations like the Central African Republic, with little access to global markets, and rapidly globalizing countries like South Africa, Mauritius, Tanzania, and Benin.

Finally, there are countries like Nigeria, Ethiopia, Sudan, and the DRC that are so large and diverse that they are difficult to govern as a single entity. While some of these larger countries often have valuable resources, they will still have trouble emerging as winners in the global marketplace unless they start to change their system of governance, Mr. Mills says.

"The critical elementary differences between [African] countries are their regimes and their natural resources," says Mills. "Since they can't change their size and resources, the one thing they can change is the style of their government, and those that are generally performing better are the latter group," which like Rwanda, South Africa, Botswana, and Uganda, have instituted substantial governmental reforms.

Innovate – don't print money

Ross Herbert, head of a research project on governance at the South African Institute for International Affairs in Johannesburg, says that one of the best signs for Africa in the past decade is that fewer African leaders solve their problems today by printing more money.

But Africa's current prosperity – largely the result of global demand for commodities such as natural gas, oil, timber, copper, iron, coal, and cobalt – is a temporary window of opportunity that analysts say should not be wasted.

"Africa has to go out into the world and learn markets," says Herbert. "Chinese companies went to Ghana and studied kinte cloth, and now you can buy Chinese cloth that emulates kinte that is cheaper than the local cloth."

"That is how competitive other countries are," he says. "We have to choose ... to climb the ladder faster than other countries. And no one, other than Zimbabwe, is standing still."